A franchise business is most
preferred kind of start up business
with about 91% of all franchises
reporting profitability ...
Ongoing support is one of the
key merits of a franchise
business, as there is a franchisor
that is always looking over the...
• A reputed brand name
• A guide who helps in entire set up
and start up of the business
• A fraction of a market that is ...
Brand
Proven Formula
Aided Set Up
Easy Financing
Shared Marketing Cost
Lower Risk
Ongoing Support
Dependence
Strict Adhere...
Even though franchise
business is gaining high
reputation and is leading
model of business which is
proven to even bear ec...
 Franchise Business is quite
dependent on the parent company
 The operational procedures are
adhered to diligently and
s...
Every style of business, perhaps, has its
own advantages and disadvantages. As a
prospective entrepreneur it depends on
yo...
Indian Institute of Hardware and Technology (IIHT) has
its own pros and cons, however it ensures that all
decisions are ta...
Corporate Headquarters
#15,Sri Lakshmi Complex, 4th Floor, St. Marks Road, Bangalore - 560 001. India
Tel: 91 80 6160 4545...
Advantages and Disadvantages of A Franchise Business
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Advantages and Disadvantages of A Franchise Business

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A franchise business is most preferred kind of start up business with about 91% of all franchises reporting profitability across the globe. However, it is important to know that franchises have their own advantages and disadvantages.

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Advantages and Disadvantages of A Franchise Business

  1. 1. A franchise business is most preferred kind of start up business with about 91% of all franchises reporting profitability across the globe, as per British Franchise Association (BFA). Franchising Business model is one of the attractive and most successful business formats of the day. Many prospective entrepreneurs chose buying a franchise over starting with a business of their own due to the various perks of buying a franchise. However, it is important to know that franchises have their own advantages and disadvantages.
  2. 2. Ongoing support is one of the key merits of a franchise business, as there is a franchisor that is always looking over the business protecting interest of both self and the franchise. Along with this come various advantages, such as
  3. 3. • A reputed brand name • A guide who helps in entire set up and start up of the business • A fraction of a market that is ready for your product or services • A proven business process and operations ready to be implemented • An ongoing research and development taken care of by franchisor • Timely upgradation, innovation and introduction of newbie • Receive extensive training • Approval on loans is simpler as bankers find franchise as a lower risk business • Marketing is usually undertaken by the franchisor for entire region, with costs shared among all the franchises. Hence there is a reduced burden of planning for marketing and the cost as well is shared. • There is access to bulk purchasing
  4. 4. Brand Proven Formula Aided Set Up Easy Financing Shared Marketing Cost Lower Risk Ongoing Support Dependence Strict Adherence Ongoing Costs All or Nothing Territory Restriction Fixed Term Agreement
  5. 5. Even though franchise business is gaining high reputation and is leading model of business which is proven to even bear economic downturns, it also comes with many disadvantages mostly related to decision making crucial for business because of which it is important to explore the downside of franchise business before making the investment and be prepared.
  6. 6.  Franchise Business is quite dependent on the parent company  The operational procedures are adhered to diligently and strictly, non-adherence may result in losing the business  Less autonomy on overall business  Restricted territory of operation  Ongoing payments, fees and other charges  Fixed term agreement, renewal of which depends on franchisors discretion  Less control on sale of franchise, and a fees is paid for same as well  You cannot pick and chose the elements from the design, it is all or nothing that a franchisor offers “Owning a franchise allows you to get into a
  7. 7. Every style of business, perhaps, has its own advantages and disadvantages. As a prospective entrepreneur it depends on you to decide what kind of start up suits you as an individual and a businessman.
  8. 8. Indian Institute of Hardware and Technology (IIHT) has its own pros and cons, however it ensures that all decisions are taken in the best interest of the business itself and the franchises. This is essential as the interest of entire business and all franchise depends on how each franchise individually performs. IIHT Franchise has its presence in countries such as China, Malaysia, Turkey and Nigeria to name a few, and has been flexible to change its processes and operations to customise the business to suit the demands of the local market in the respective country like any international franchise business. IIHT has a reputation for timely upgradation and introducing courses in latest
  9. 9. Corporate Headquarters #15,Sri Lakshmi Complex, 4th Floor, St. Marks Road, Bangalore - 560 001. India Tel: 91 80 6160 4545 e-mail: franchise@iihttechnologies.com web: www.iihttechnologies.com/
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